How virtual meetings and business travel coexist

Relationship is everything for businesses. But the onset of remote working is changing the way we connect.

The ability to work remotely is one of the biggest paradigm shifts in recent years - at least when it comes to the workplace. And this is all thanks to virtual meeting and web communication software.

With many people getting used to working from home, one might assume that travel for business will fall out of favor. However, we have found time and again that this is not the case.

While virtual meetings and business travel will continue to coexist, it is worth exploring how the two will actually work together moving forward. And so we ask: how have virtual meetings changed the way we travel for business?

Before we answer that, let’s set the scene.

Understanding the work-from-home revolution

A quick look on Wikipedia reveals that remote working first became a ‘thing’ all the way back in the 1970’s. This was supposedly facilitated by the use of telephone lines, leading to the coining of the term ‘teleworking’.

Obviously, technology has developed significantly since then. Most notable of all was the internet. This global network, together with the digitalization of many jobs, meant that remote working and thus working from home became more viable for more people – yet another example of the encompassing digitalization of business travel.

This is all to say that online communication tools are not new to the corporate landscape. However, the heavy reliance on them is. And there is one phenomenon to blame.

The elephant in the room

While a sizable number of employees had enjoyed the perk of working remotely over the years, it was ultimately the pandemic – and the subsequent lockdowns – that lead to working from home becoming mainstream.

And it’s really interesting to see how remote work has evolved as people have adapted and perhaps gotten more comfortable with it.

A report from HBR found that, compared to 2020, people were in 60% more meetings in 2022. While the frequency was increasing, the length of the average meeting was becoming shorter. [1]

Whatever the reason behind this, it’s clear that virtual communications have made an impact on the way we work. And that brings us to the question of today: Can virtual meetings really replace the need for business travel?

 

The case for virtual meetings

Virtual meeting software, especially at enterprise scale, requires significant investment. And not just financially either: Incorporating and integrating it into the workflow of the business takes some work to get right.

But it seems to be paying off as virtual meetings are proving to be an effective tool.

Managers are still on board

Based on a recent survey of 743 top managers in Germany, the U.S., the UK, China, Italy, and France, we found a consensus that remote working will continue for many of us, remaining a key tool used by professionals – at least in some positions. [2]

It’s easy to understand why: A lot of time and effort went into setting up the software and making it work – so much so that it is not likely to be dropped any time soon. Businesses will of course want to get their money’s worth from their investment.

The industry is adapting

Looking at the wider industry, we can see how travel restrictions have led to a ‘new normal’. This can best be seen with conferences and exhibitions. The MICE market has also been going virtual or adopting a hybrid approach, seeing the benefits of online video conferencing.

According to data from Statista, respondents from the US (52%) and Japan (65%) are seemingly open to embracing the hybrid approach in the future by attending events both in-person and via video conferencing. [3]

Productivity is actually up

Some data suggests that productivity is increased when working remotely – another key benefit. At 77%, over two thirds of employees who work remotely at least a few times a month reported greater productivity when they work offsite. [4]


online-meetings-vs-business-travel

 

There are plenty of perks to working remotely using web conferencing software...

It stands to reason that cutting out of commuting and other non-work-related tasks associated with in-office working helps towards overall productivity. However, many other factors such as generally increased morale and happiness among employees also plays into this.

It’s impacting bottom lines

This lack of traveling for business, conferences and commuting brought about by video conferencing software has resulted in 47% of video call users seeing their travel costs reduced. [5]

Any savings are of course welcome by businesses, and this data may inform future travel-related decision making.

Perspectives are changing

With the pandemic putting a pause on business travel, many have said that they will rethink how they approach it moving forward. This includes traveling less by considering whether certain meetings are worth the cost and effort of travel. [6]

But not everything about video conferencing is positive.

 

The case for business travel

Business travel has long been the preferred method of meeting with customers. Just like the telephone and email before it, virtual meeting software is just missing that certain something.

Intangible benefits

For many, business travel offers a lot more than a simple meeting – something that cannot be replicated through a screen.

Many are quick to point out that words only represent a small part of communication, with body language and other subtle cues coming in physical forms. This does not always translate well through a webcam, making important sales meetings more difficult to make online.

Looking a bit more broadly, business travel is seen as a major way for the traveler to build personal connections and make their way up the corporate ladder. Many see a handshake as a powerful tool for building these connections and bonding with clients and coworkers alike.

It is no surprise then that face-to-face meetings are proven to be effective.

The power of face-to-face meetings

One study working with both executives and business travelers suggested that around 40% of their prospective customers are converted to new customers with an in-person meeting compared to 16% without such a meeting. [7]

That same study also found that an estimated 28% of current business would be lost without in-person meetings, further highlighting its effectiveness in building and maintaining relationships.

Ultimately, about 80% of CEOs and top managers we surveyed believe personal contact with customers and suppliers remains essential. This is despite the fact that 59% expect higher prices for transportation and accommodation. [8]

Online is not equal to in-person

Once again, we have something intangible – a certain je ne sais quoi – that differentiates the online and in-person experience.

According to one research article, online and onsite attendees were found to experience an event slightly differently. Those attending online found it more difficult to concentrate in some cases compared to their counterparts attending in-person. [9]

The desire to travel

The data also shows that people want to travel. Our invoicing volume data for Germany in June 2022 was only around 10% below the level of June 2019. [10] This hints that the move to online communications was temporary and not meant to be the all-encompassing replacement.

The point is that, despite the current and expected future challenges and the proliferation of software that allows meetings to take place online, businesses are adamant on the benefits of travel and being physically on-location.

 

Can virtual meetings and business travel coexist?

Coming back to our main question, we now have a clear answer: Yes.

Business travel and remote work, as powered by virtual meeting software, both have their place in a business’s repertoire. It comes down to the circumstances and the need for the meeting.

When is travel the answer?

Based on a survey of 111 C-level executives [11] in Germany, including CEOs, heads of finance and heads of sales, we discovered the business purposes (other than manual activities) which will still require personal encounters in the future:

top-reasons-why-businesses-travel-data

Is the purpose of a meeting sensitive or particularly important in terms of building trust? Then travel is the answer.

Is the meeting smaller in scope and less strategic? Then a virtual meeting would suffice.

But if virtual meeting software is effective enough to essentially power a remote workforce as demonstrated during the pandemic, some may put the industry under more scrutiny. Businesses will increasingly need to justify their traveling, and for multiple stakeholders.

 

The changing dynamic of business travel

While it’s all well and good that businesses are insistent on the need to travel, it is a safe bet that the dynamic of business travel – how it will work in the future – will change.

The pandemic shut down almost all non-essential travel such as that for business. What this has led to is a big opportunity for a reset – both in the industry as a whole and the expectations of traveling employees.

There are broadly two different pillars that will play large roles in redefining travel in this digital age:

How sustainability is changing the way businesses travel

While many businesses still see face to face meetings as ‘indispensable’, the improvement of online video conferencing infrastructure will mean there is more pressure than ever on both justifying the need for travel and further scrutiny into the sustainability of travel.

And many companies are now looking towards their ESG score and identifying ways to reduce their environmental impact too.

Shorter trips out of favor

This could explain why shorter trips seem to be losing their luster. The general consensus in the business travel industry is that businesses will be looking at making longer and less frequent trips. [12]

Our own research backs this up, as we found that the average business trip duration increased amongst German travelers from 5 days in the second half of 2019 to 6.3 days in 2020. Only 7% of business trips in 2022 lasted only one day. [10]

There is also the trend towards the use of trains for such business trips, at least where time permits.

In general, there are signs that one-day or one-meeting trips are being phased out in favor of online communication, or otherwise combined into larger itineraries.

Taking flights for small distances and short trips can be seen as wasteful after all, so longer itineraries are becoming the norm. Alternatively, trains and other public transport options are being favored where possible.

Case study: Siemens

One example we can look at that highlights this shifting focus on sustainability is with Siemens. Siemens recently announced that it will be introducing a new eco-friendly fleet for use as company cars. [13]

Where business travel is still necessary or when heading to the office, switching to an electric or hybrid will, over time, really make a difference.

Basically, business travel is cleaning up its act by making changes here and there – but it is not going completely.

How flexibility is changing the way businesses travel

Just like how a lot more emphasis will be placed on sustainability, flexibility will also come into the limelight. Especially in the beginning, it will be a buyers’ market where supply of business-oriented travel services will outpace the demand from businesses.

The travelers’ market

This will give the business traveler more power to demand changes that fit their needs – likely in the form of increased flexibility. This could be providing the traveler with options of which hotel or area they stay in or more control over the choice of transportation.

Sustainability and flexibility go hand in hand, evidenced once again by Siemens who, as well as moving to eco-friendly vehicles, will start to offer more flexible leasing options. This means that workers will have more control over when and which vehicle they use based on their needs.

Of course, not everyone has access to a company car – or needs one in the current working climate.

Options such as ride-hailing and other technical innovations in the transport space enable a greater level of flexibility. This is much easier to organize when on the ground and also lends itself better to the growing ‘bleisure’ travel trend. [14]

This is yet another example of the traveler's need for flexibility.

‘Bleisure’ is proving popular and effective

As you can probably tell, ‘bleisure’ travel refers to trips that combine business needs with leisure activities. Seeing that business trips are getting longer, this kind of combined travel may well work out better both for morale and potentially the environment.

We are seeing significant consumerization of business travel in the market. As we have seen in the B2B payment space, this consumerization – the integration of consumer-grade solutions that are easy and intuitive – is starting to make its way into travel, making it more accessible and therefore empowering travelers.

A lot of this is being led by Mobility as a Service. This is leaving legacy systems as just that – a legacy. Instead, it is a platform that provides access to different types of transport from buses to trains to bicycles. This makes it much more convenient to use.

 

Virtual meetings and business travel drive innovation

Love it or hate it, online video conferencing has become an essential part of the workplace.

While it poses many technical issues, it also offers the ability to communicate with your team wherever you are. This means you can talk with coworkers, clients and suppliers on the other side of the country or even the world.

Despite this ability, there is a clear desire for business travel to return. However, the integration of this technology along with the changing perceptions and priorities of businesses following the global pandemic will change the ways they approach travel.

Shorter trips, which can be seen as wasteful, will fall out of favor for many as sustainability topics take the forefront. Likewise, employees will likely feel more emboldened and so expect more flexibility in their work travels.

Whether that is an extra day for leisure activities or simply more autonomy in choosing how to get to a destination or where to stay, policies will need to change to accommodate this. Otherwise, this talent may start looking elsewhere.

Then there is new technologies to look out for: VR and the Metaverse may help revolutionize the field and facilitate the type of connections that businesses seek. Only time will tell when that will be enough.

To summarize, the ability to work remotely has made a huge impact on businesses. We are now entering the time of quality travel – achieving more in fewer journeys. This means more time at the destinations, more meetings, more collaborations and even more leisure time.

Subscribe to our newsletter today to get more deep-dives into the shifting corporate travel and payment landscape.

 

Photo by DocuSign on Unsplash

[1] No, remote employees aren't becoming less engaged | HBR.org

[2] Companies will continue to rely on remote working | AirPlus.com

[3] In-person vs online event attendance after Covid-19 worldwide | Statista.com

[4] Study: Teleworkers more productive—even when sick | SHRM.org

[5] Banty CEO Scott Wilson talks about how virtual meetings can reduce business travel costs | PRNewswire.com

[6] Business travel in the age of Zoom | Worth.com

[7] The role of business travel in the US economic recovery | USTravel.org

[8] Business sector well prepared for business travel comeback | AirPlus.com

[9] Hybrid conferences: opportunities, challenges and ways forward | Frontiersin.org

[10] Business travel trends 2022 | AirPlus.com

[11] Despite remote work and video conferencing: Business travel remains important for German companies | AirPlus.com

[12] Welcome to the post-covid business trip | Forbes.com

[13] Siemens to introduce sustainable and flexible company car policy | Siemens.com

[14] Global Business Travel Market Report 2021 | BusinessNewswire.com


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